Block defeats shareholder lawsuit over 2021 Cash App data breach

New York (Reuters) – Technology and Financial Services Company led by Twitter Founding Partner Jack Dorsey, Block, on Tuesday, won the lawsuit by claiming that it was misleading in connection with a major data violation in the Cash Application Mobile Payment Service.

The US Region Judge Margaret Garnett in Manhattan could not find any evidence block aimed at defrauding shareholders in connection with the 10 December 2021 violation, when a former employee has downloaded his personal information by about 8.2 million cash application users.

The shareholders in the proposed class action inflated the share price by explaining Block’s inadequate data safety before violation and then waiting for about four months before revealing the violation on April 4, 2022.

They also accused the Oakland -based Oakland, based in California, in January 2022, Australia “Now, Pay”, to complete the purchase of $ 29 billion, the former shareholders of Afterpay’s former shareholders of data security.

In a 42 -page decision, Garnett said that reasonable investors could not see general statements about potential risks as allegations that data safety is intact on the block and website made in regulatory files.

He also said that shareholders could not show any “unique” connection between alleged inaccuracies and post -payment, or that these block managers have benefited in a concrete way to create a motive for fraud.

For the shareholders, lawyers did not respond immediately to their requests for comments after Sunday hours. Block and his lawyers did not respond immediately to similar requests.

In January, Block agreed to pay 80 million dollars to solve the accusations that the cash application of 48 state financial regulators lacked sufficient money laundering policy. In April, it reached a similar $ 40 million agreement with New York.

A regulatory filing showed that Cash App was 57 million per month at the end of the year at 2024 and at the end of the year.

In the case of Re Block Incurities, the US Regional Court, the southern region of New York, No. 22-08636.

(Reporting by Jonathan Stempel in New York; Editing by Chris Reese and Jamie Freed)